Q2 2020 Retrophin Inc Earnings Call

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Liisa Ann Bayko: transcript Emily Beynon Ladies and gentlemen, today's conference is scheduled to begin momentarily. Until that time, your lines will again be placed on music hold.

Ladies and gentlemen, today's conference is scheduled to begin momentarily until that time Airlines will again be placed on music cold. Thank you for your patience.

unknown: Thank you for your patience. [inaudible] ??? ??? ??? , , , , , , , , , , , , Ladies and gentlemen, thank you for standing by. And welcome.

unknown: To the Retrofin Inc. Second Quarter Financial Results and Corporate Update call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you may do so by pressing star 1 on your telephone keypad. One moment. One moment. To ask a question during the session, you may do so by pressing star 1 on your telephone keypad. One moment. To ask a question during the session, you may do so by pressing star 1 on your telephone keypad. Hello, Yes, this is the conference operator.

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unknown: Please keep it down, guys.

Cora: I apologize, Chris. We're slowly getting people back into the sub-conference, and I will go ahead and transfer you and them. Then, I'll go ahead and get everyone back into the sub-conference with you, and then I'll transfer everyone to the main conference.

Cora: Thanks, Cora. Thank you. Ladies and gentlemen, thank you for standing by. I apologize for the delay and welcome to the Retrophin, Inc. Second Quarter Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press Star 1 on your telephone keypad.

Ladies and gentlemen, thank you for standing by.

unknown: Please be advised that today's

unknown: Today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to turn the call over to Mr. Chris Cline. That's all. Please go ahead.

And welcome.

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Christopher Cline: Thank you, Corey. Good afternoon, and welcome to Ritrofen's second quarter 2020 financial results and corporate update call. Thank you for joining us today and thank you for sticking with us through some of the technical difficulties we were just experiencing. I hope you all remain well. Today's call will be led by our Chief Executive Officer, Dr. Eric Dube. Eric will be joined for prepared remarks by our Chief Medical Officer, Dr. Noah Rosenberg, and Peter Heerma, our Chief Commercial Officer.

To the Retrophin.

ER Retrophin Inc. second quarter financial results and corporate update call.

At this time all participants are in a watch listen only mode.

unknown: Laura Clagg

Christopher Cline: Dr. Bill Rote, Senior Vice President of Research and Development, will join us for the Q&A session. Before we begin, I'd like to remind everyone that statements made during this call regarding matters that are not historical facts are forward-looking statements within the safe harbor provisions of the Private Security and Litigation Reform Act of 1995. Forward-looking statements are not guarantees of performance. They involve known and unknown risks, certainties, and assumptions that may cause actual results, performance, and achievements to differ materially from those expressed or implied by the statement. Please see the forward-looking statement disclaimer in the company's press release issued earlier today, as well as the risk factors section in our Forms 10-Q and 10-K filed with the SBA. In addition, any forward-looking statements represent our views only as of the date such statements are made, July 30, 2020, and RETROFIN specifically disclaims any obligation to update such statements to reflect future information, events, or circumstances.

After the speakers presentation, there will be a question and answer I wish I had to ask a question. During this section you may do show by pressing star one on your telephone keypad one moment.

Eric Dube: With that, let me now turn the call over to Eric. Okay?

Eric Dube: Thank you, Chris, and good afternoon, everyone. The needs of patients living with rare diseases are greater than ever, and I am proud of our organization's steadfast dedication to supporting our communities, advancing our development programs, and delivering our approved products during this difficult time. I am pleased to report that during the second quarter, our team members maintained focus on the key priorities to best navigate the COVID-19 pandemic and continue to make meaningful progress towards our goals for the year. This was highlighted by the further advancement of our two pivotal trials for Sparcentin and the continued delivery of our approved therapies to current and new patients. We were able to achieve this by maintaining a focus on the safety and well-being of our team members and our patients. For our team members, we continue to embrace a remote work environment, and I am incredibly impressed by how our teams come together every day on a virtual basis and identify innovative ways to advance our initiatives and meet the needs of our patients.

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Yes. This is the conference operator.

Eric Dube: For our patients, we have maintained our procedures to ensure safety, access, and continuity of care during this time. As for our development programs, both the duplex study of sparsentin in FSGS and the PROTECT study in IJ nephropathy continue to advance towards top-line readout, which, if positive, we expect to support accelerated approval submissions in the U.S. and Europe. We continue to work within the COVID-19 specific FDA and EMA guidance to ensure compliance with good clinical practice and maintain trial integrity during these unprecedented times. And, most importantly, we have been pleased with the study conduct to date for both trials.

Eric Dube: This has been driven by the strong dedication from our patients, their caregivers, and investigators, as well as our teams, ensuring close coordination with clinical sites to maintain adequate monitoring and a clear focus on data capture and integrity. I am also encouraged by the fact that both of our pivotal programs evaluating Sparsantan have regained some momentum in screening and enrollment since our last update in May. From the outset of the Sparsentine program, we have been working with the global nephrology community to connect clinical sites and form a strong network that can best support our studies in FSGS and IJ nephropathy.

Eric Dube: This network has been critical for providing insights into the unique needs that clinical trial participants face so that we can provide adequate support during this time and enable our studies to continue screening and enrollment at sites that remain open or that have reopened in this environment. Based upon what we know today, enrollment in our duplex study in FSGS remains in line with our prior projections. And we believe top-line data from the 36-week proteinuria endpoint analysis remains achievable in the first quarter of next year. I am also pleased to report that the PROTECT study in IJ nephropathy is trending ahead of schedule. We now anticipate that top-line data from the 36-week proteinuria endpoint analysis in PROTECT will be achievable in the second half of next year, compared to our previous guidance of the first half of 2022. While we cannot predict the future impact of COVID-19, I am encouraged by the progress made to date and by the current trajectory of having readouts from the 36-week proteinuria analysis in both pivotal studies next year. As for our commercial performance, in the second quarter, we reported another strong period of execution.

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Eric Dube: I have been pleased with our field-based team's ability to maintain engagement with physicians and with the growth in new treatment initiations during the initial period of the pandemic. Our teams are continuing to provide the necessary support and information to make important treatment decisions. I have also been pleased with the Total Care Hub and its continued prioritization of access and support for patients receiving our approved therapy. They have adapted as necessary to meet patient needs and ensure continuous supply during this challenging time. This further demonstrates our capabilities to effectively serve the rare nephrology and hepatology community. As we look ahead, we are continuing to monitor the potential impact of the pandemic on our commercial performance in the second half of the year, but we currently believe that our initial guidance of mid-single-digit growth in net product sales for the full year is achievable. During the second quarter, we also further strengthened our financial foundation by completing a successful follow-on equity offering. The additional capital will allow us to make the necessary investments to prepare for a successful launch of Sparcentum, if approved, and provide additional flexibility as we evaluate potential business development opportunities to diversify our future growth potential.

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I apologize, Chris I'm, whereas slowly getting people back into the Subcom French.

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Eric Dube: We believe these efforts will help fortify our position as a leader in the rare disease community, and we are grateful to the investment community for the continued support of our mission. Overall, I continue to be impressed by the resilience and commitment of our organization, patients, and their caregivers, physicians, and partners, all of whom have contributed to advancing our therapies during this period. Now, let me turn the call over to Noah for an update on our clinical programs. Noah?

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The 120 go ahead and get everyone back into the Subcom friends with you when they're not transfer everyone to the main.

Noah Rosenberg: Thank you, Eric. And good afternoon. Both of our pivotal studies of sparsantan continue to advance despite the challenges presented by COVID-19. Over the last several months, we have seen incredible support and fortitude among the rare renal community. This is a testament to the significant unmet need that exists for FSGS and IJ nephropathy and the drive of patients, families, investigators, and sites in the quest to find improved treatment options. It also speaks to the belief that sparse sentences potential, if approved, to shape the treatment paradigm for patients living with these rare renal conditions.

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Next quarter.

Ladies and gentlemen, thank you for standing by I apologize for the delay and welcome.

Choosy Retrophin Inc. second quarter financial results and corporate update conference call.

At this time all participants are in listen only mode. After the speakers presentation. There will be a question and answer session to ask a question. During the session you want need to press star one on your telephone keypad.

Please be advised that today's conference is being recorded if you require any further assistance. Please press star zero I would now like to turn the call over to Mr., Chris Cline.

Noah Rosenberg: In keeping with these expectations, I have been very pleased with the performance of our clinical and operational teams over the last several months. Throughout this period, we have maintained close contact and collaboration with study sites, principal investigators, and CRL partners so that we are all aligned on the best ways to manage the COVID-19 pandemic. Doing so has enabled us to better understand and address the evolving needs of patients during these challenging times and to provide ongoing support. And we have maintained a clear focus on the key priorities of patient safety, ensuring continuous drug supply, and preserving data integrity and documentation in alignment with FDA and EMA guidance. We believe that the continued focus on these priorities, which we outlined on our last call, has helped us best mitigate the impact of COVID-19 on our ongoing trials thus far.

Sir Please go ahead.

Great. Thank you Corey good afternoon, and welcome to Retrophins second quarter 2020 financial results in corporate update call. Thank you for joining us today and thank you for sticking with us through some of the technical difficulties. We were just experiencing I hope you all remain well.

Today's call will be led by our Chief Executive Officer Dr. two day, Eric will be join for the prepared remarks by our Chief Medical Officer Dr., No Rosenberg, Peter Hermine, our Chief commercial officer, and our Chief Financial Officer Lore Clegg.

Dr. Bill wrote senior Vice President of research and development will join us for the QNX session.

Before we begin I'd like to remind everyone that statements made during this call regarding matters that are not historical facts are forward looking statements within the safe Harbor provisions of the private Securities Litigation Reform Act of 1995.

Forward looking statements are not guarantees or performance they involve known and unknown risks uncertainties and assumptions that may cause actual results performance and achievements to differ materially from those expressed or implied by the statement.

Noah Rosenberg: We have also seen remarkable dedication from patients and their families, investigators and site staff, and the global clinical network supporting our programs, which has enabled our studies to adapt as needed. To date, we have maintained a continuous supply of investigational drugs for sites and patients, and we have effectively utilized telemedicine. Remote Monitoring, and other activities as needed to ensure patient safety remains paramount for those enrolled in Duplex and Protect. We also continue to focus on the key endpoint and safety data in our studies. To date, we have seen close adherence to study plans and scheduled visits.

Please see the forward looking statement disclaimer on the company's press release issued earlier today as well as the risk factor section in our form 10-Q, and 10-K filed with the SEC.

In addition, any forward looking statements represent our views only as of the date such statements are made July Thirtyth 2020, and retrofit specifically disclaims any obligation to update such statements to reflect future information events or circumstances.

With that let me now turn the call over the air fare.

Thank you, Chris and good afternoon, everyone.

The needs of patients living with rare disease are greater than ever and I am proud of our organization steadfast dedication to supporting our communities advancing our development programs and delivering our approved products. During this difficult time I.

Im pleased to report that during the second quarter, our team members maintaining focus on the key priorities. The best navigate the cobot 19 pandemic and continue to make meaningful progress towards our goals for the year.

Noah Rosenberg: This has resulted in steady data collection in both studies, and we believe we are well positioned to deliver high-quality readouts. As we mentioned in our last update, global restrictions to combat the COVID-19 pandemic have, not surprisingly, resulted in a reduction in recruitment activities for both studies. While we cannot control what may lie ahead with the pandemic, we are seeing encouraging signs of clinical restrictions easing throughout the global network. As a result, we have seen both screening and randomization rates for duplex and protect increase relative to the slowdown experienced in the spring. The Phase 3 Duplex Study Evaluating Spursenten in FSGS is progressing as expected during this phase. As many of you will recall, in March, we achieved enrollment of the 190th patient in our duplex study.

This was highlighted by the further advancement of our two pivotal trials for Sparsentan and the continued delivery of our approved therapies to current and new patients.

We were able to achieve this by maintaining focus on the safety and well being of our key members.

And our patients.

For our team members, we continue to embrace a remote work environment and I am incredibly impressed by how our teams come together every day on a virtual basis and identify innovative ways to advance our initiatives and meet the needs of our patients.

For our patients we've maintained our procedures to ensure safety access and continuity of care. During this time.

As for our development programs, both the duplex study of Sparsentan and Fscs and the protect study in Argentina profit. They continue to advance towards topline read outs, which if positive we expect to support accelerated approval submissions in the U.S. and Europe.

We continue to work within the Cobot 19 specific FDIC and you may guidance to ensure compliance with good clinical practice and maintain trial integrity. During these unprecedented times.

Noah Rosenberg: The duplex study protocol provides for a pre-specified interim analysis to evaluate the proteinuria efficacy endpoint in the first 190 patients after 36 weeks of treatment. The successful achievement of this 36-week partneria endpoint is expected to serve as the basis for submission of filings for accelerated approval in the U.S. and Europe. We continue to believe that top-line data from the 36-week primary analysis will be achievable in the first quarter of next year. However, if, based upon the pre-specified sample size of the assessment, we elect to increase the number of patients to further support the confirmatory eGFR endpoint and enrollment trends slow or do not continue to accelerate as a result of COVID-19, it could result in an adjustment to the timing of the top-line

Importantly, we've been pleased with the study conduct to date for both trials.

This has been driven by the strong dedication from our patients their caregivers and investigators as well as our teams ensuring close coordination with clinical site to maintain adequate monitoring and a clear focus on data capture and integrity.

I'm also encouraged by the fact that both of our pivotal programs evaluating sparsentan have regained some momentum in screening and enrollment since our last update in may.

From the outset of this far sensing program, we've been working within the global net nephrology community to connect clinical sites and form a strong network that can best support our studies and Fs, Jeff and I Jane prophecy.

This network has been critical for providing insights into the unique needs that clinical trial participants space. So that we can provide adequate support during this time and enabling our studies to continue screening and enrollment at sites that remain open or that have reopened in this environment.

Based upon what we know today enrollment of our duplex study in SGS remain in line with our prior projections and we believe topline data from the 36 week Proteinuria endpoint analysis remains achievable in the first quarter of next year.

Noah Rosenberg: The Phase 3 PROTECT study evaluating sparsantan in IJ nephropathy has regained better than anticipated momentum, and current enrollment trends are now ahead of schedule. Based upon our current trajectory, we anticipate achieving enrollment of the 280th patient this year, which would make top-line data from the 36-week pertinear analysis achievable in the second half of next year. If successful, the 36-week peritoneal analysis from the first 280 patients is expected to support accelerated approval filings in the U.S. and Europe. However, similar to duplex, if enrollment trends slow or do not continue to accelerate as anticipated for an extended period as a result of COVID-19, it could result in an adjustment to the timing of a top-line readout. Overall, I'm very pleased with our progress and accomplishments during the initial stages of this challenging period. The continued advancement of our studies has positioned us for two high-quality readouts next year and moves us closer to our goal of ultimately delivering the first medicine indicated for FSGS and IgA nephropathy, if approved. Let me now turn the call over to Peter for the commercial update. Okay, Peter?

I'm also pleased to report that the protect study in Argentina property is trending ahead of schedule. We now anticipate the topline data from the 36 week proteinuria endpoint analysis in protect our achievable in the second half of next year compared to our previous guidance of the first half of 2022.

While we cannot predict the future impact of Cobot 19.

And encouraged by the progress made to date and by the current trajectory of having read outs from the 36 week Proteinuria analysis in both pivotal studies next year.

As for our commercial performance in the second quarter, we reported another strong period of execution I.

I've been pleased with our field based teams ability to maintain engagement with physicians and with the growth in the new treatment initiation during the initial period of dependent.

Our teams are continuing to provide the necessary support and information to make important treatment decisions.

I've also been pleased with the total care hub and its continued prioritization of access and support for patients receiving our approved therapies.

They have adapted as necessary to meet patient needs and ensuring continuous supply during this challenging time.

This further demonstrates our capabilities to effectively serve the rare nephrology and hepatology communities.

As we look ahead, we're continuing to monitor the potential impact of the pandemic on our commercial performance in the second half of the year.

But we currently believe that our initial guidance of mid single digit growth and the net product sales for the full year is achievable.

During the second quarter. We also further strengthened our financial trying to foundation by completing a successful follow on equity offering.

Peter Heerma: Thank you, Norma. Our commercial organization further demonstrated its unwavering commitment to supporting patients receiving our Approved Therapy and the capabilities necessary to support precision efforts to identify and treat new patients throughout this challenging time. We report a strong second quarter with 8% growth over the same period last year. This was driven by underlying demand and new patient initiations for all products. The continued focus on support and access for those patients prescribed our products and a moderate increase in patient compliance. During the second quarter, our field-based teams maintained virtual engagement with healthcare professionals and found solid receptivity to the information and resources to enable further identification and treatment for patients that may benefit from our therapy. The uptake of Stiola AC was a key driver of growth during the quarter.

The additional capital will allow us to make the necessary investments to prepare for a successful launch of Sparsentan, if approved and provide additional flexibility as we evaluate potential business development opportunities to diversify our future growth potential.

We believe these efforts will help fortify our position as a leader in the rare disease community and we are grateful to the investment community for the continued support of our mission.

Overall I continue to be impressed by the resilience and commitment of our organization patients and their caregivers physicians and partners all of whom have contributed to advancing our therapies. During this period now let me turn the call over to Noah for an update on our clinical programs Noah.

Thank you Eric and good afternoon.

Both of our pivotal studies of Sparsentan continued to advance despite the challenges presented by covert 19 over the last several months, we have seen incredible support and fortitude amongst the rare renal community. This is a testament to the significant unmet need that exists for after she us in our junior property.

And the drive a patients families investigators and sites in the quest to find improve treatment options.

It also speaks to the belief in score sentence potential if approved to shape the treatment paradigm for patients living with these rare renal conditions in keeping with these expectations I have been very pleased with the performance of our clinical and operational teams over the last several months throughout this period.

Peter Heerma: We remain encouraged by the continued broad usage amongst patients, including those who discontinued the original formulation, and the launch continues to exceed expectations. We also saw meaningful treatment initiations with the bile acid portfolio and continue to be pleased with the utilization of our genetic panel to help colostatic patients potentially find an earlier diagnosis. Our organization takes great pride not just in delivering needed treatment to new patients but also in maintaining the access and support that we know is critical. Throughout the quarter, the Total Care Hub works with patients to ensure an uninterrupted supply of medication and provide education and counseling as needed to ease the burden of living with a rare disease during this time. In the first quarter, we estimated that the initial reaction to COVID-19 drove about $1.5 to $2 million worth of forward shipments and increased compliance. As anticipated, the forward shipments of 60 and 90 day supply normalized during the second quarter, and we resumed our normal shipping pattern.

We have maintained close contact in collaboration with study sites principal investigators and CRL partners. So that we are all aligned on the best ways to navigate the cobot 19 pandemic doing so has enabled us to better understand and address evolving needs of patients. So.

During these challenging times and to provide ongoing support.

And we have maintained a clear focus on the key priorities of patient safety, ensuring continued stroke supply preserving data integrity and documentation in alignment with FDA and M&A guidance.

We believe that the continued focus on these currencies, which we outlined on our last call has helped us desks mitigate the impact of Coke 19 on our ongoing trials thus far.

We have also seen a remarkable dedication from patients and their families investigators and site staff and the global clinical network supporting our programs, which has enabled our studies to adapt as needed to date, we have maintained continuous supply of investigator.

I will drug for sites and patients and we have effectively utilize telemedicine remote monitoring and other activities as needed to ensure patient safety remains paramount for those enrolled in duplex and protected.

We also continue to focus on the key endpoint and safety data in our studies to date, we have seen close adherence study plans and scheduled visits. This has resulted in steady data collection in both studies and we believe we are well positioned deliver high quality readout.

Peter Heerma: We continued to see a modest increase in patient compliance across our products during the second quarter. We believe this is a result of the desire by patients to have optimal control of their conditions during this time of added stress on the healthcare environment, as well as a recognition of the increased flexibility that Viola EC may provide. Looking ahead, we are continuing to monitor the impact of unemployment changes on patient insurance costs. However, today, we have not seen a material change. We remain committed to supporting our patients and ensuring that no one goes untreated. However, we also believe that patients, including those who may be candidates for our therapies, are visiting their physicians less frequently. While we have seen underlying demand to date, this could lead to fewer patients initiating treatment in the second half of the year.

As we mentioned on our last update global restrictions to combat the Coca 19 pandemic not surprisingly resulted in a reduction in recruitment activities for both studies, while we cannot control what may lie ahead with the pandemic, we are seeing encouraging signs of clinical restrictions easing.

Throughout the global network as a result, we have seen both screening and randomization rates for duplex and protect increase relative to the slowdown experience in the spring.

The phase three duplex study evaluating Sparsentan NFPA Shiites is progressing as expected during this.

This time.

As many of you will recall in March we achieved enrollment of the 190 of patient in our duplex study. The duplex study protocol provides for a pre specified interim analysis to evaluate the coronary yes efficacy endpoint in the first 190 patients after 36 weeks of treatment.

Peter Heerma: Nevertheless, given the strong start to the year, we believe our forecast for mid-single-digit growth over the previous year remains achievable. Overall, we are very pleased with the clear focus and performance of the commercial business to start 2020, especially in the face of the COVID-19 pandemic. So for the remainder of the year, we will continue to focus on the needs of our patients, as well as build upon our existing capabilities in order to support the continued organic growth of our approved products and ultimately maximize the potential of sparse income for patients living with FFDS and IgA nephropathy, if approved. I will now turn the call over to Laura for the financial update. [inaudible]

Successful achievement of this 36 week proteinuria endpoint is expected to serve as the basis for submission of filings for accelerated approval into us and Europe.

We continue to believe that topline data from the 36 week coronary analysis are achievable in the first quarter of next year. However, if based upon the pre specified sample size. We assessment, we elect to increase the number of patients that further support the confirmatory each of our endpoint.

And enrollment trends slow or do not continue to accelerate as a result October 19. It could result in an adjustment to the timing of the topline readout.

Laura Kathryn Chico: Thank you, Peter. Before I go through our financial results for the quarter, please note that I will be discussing certain non-GAAP financial results. These non-GAAP results were also included in the earnings press release that we issued shortly before this call, along with a presentation of the most directly comparable GAAP financial measure and a reconciliation to GAAP. The earnings press release is located on the Investors in Media page of our website, retropen.com.

The phase three protect study evaluating sparsentan and Arjuna property has regained better than anticipated momentum and current enrollment trends are now ahead of schedule based upon our current trajectory, we anticipate achieving enrollment of the 280 of patient this year, which would make.

Topline data from the 36 week Port Urinalysis achievable in the second half of next year.

If successful the 36 week coronary analysis from the first 280 patients as expected to support accelerated approval filings in the us in Europe.

Laura Kathryn Chico: During the second quarter, net product sales from our commercial portfolio grew to $48.4 million, an 8% increase over the same period in 2019. We reported a gap net loss of $26.1 million for the second quarter of 2020. After adjusting for non-cash expenses and income tax, we reported a non-GAAP net loss of $9.9 million. On a gap basis, R&D expenses were $30.8 million for the second quarter of 2020. The decrease compared to the same period in 2019 is largely attributable to the discontinuation of the FOSMET Pantotenate Development Program in the fourth quarter of 2019. On an adjusted basis, R&D expenses were $28.2 million for the second quarter. Relevant non-cash expenses for the second quarter included $2.6 million of stock-based compensation and amortization. On a gap basis, selling, general, and administrative expenses for the second quarter were $35 million. The minimal decrease over the same period in 2019 is largely attributable to lower professional earnings.

Similar to duplex, if enrollment trend slow or do not continue to accelerate as anticipated for an extended period. As a result October 19. It could result in an adjustment to the timing of the topline readout.

Overall, I'm very pleased with our progress and accomplishments during the initial stages of this challenging period. The continued advancement of our studies has positioned us for two high quality Readouts next year and moves us closer to our goal of ultimately.

Covering the first medicine indicated for Fscs in Nigeria property if accrued.

Let me now turn the call over to Peter for the commercial update Peter.

Thank you know.

Our commercial organizations sooner demonstrated its invigorating commitments to supporting patients receiving our approved therapies.

And the capabilities necessary to support positions efforts to identify and treat new patients who will help to sell and you've done.

We ripple into strong second quarter was 8% growth over the same period last year.

This was driven by underlying demand and new patient initiations to old Burks.

Continuous focus on supports and access for those patients for shred of bonus and a moderate increase in Beijing compliance.

During the second quarter, our fuel based teams maintain suitable engagements with healthcare professionals and some solid specifically to the inflammation in the resources to enable foods are identification in Threeq was hoping issues that may benefit from our therapies.

Laura Kathryn Chico: On an adjusted basis, STNA expenses for the second quarter were $25.8 million. Significant non-cash adjustments for the quarter consisted of $9.2 million in stock-based compensation and depreciation and amortization. Looking ahead.

The uptake of sale as he was a key driver of growth during the quarter.

We remain encouraged by the continued growth usage among stations, including those who discontinued the original formulation.

Laura Kathryn Chico: Our near-term operating expenses may continue to be difficult to predict as we further navigate COVID-19. However, based upon what we know today, we anticipate that R&D will incrementally increase from current levels as we continue to invest in our pivotal trials. And we anticipate SG&A spend will likely be similar to modestly lower in the coming quarter. We believe our financial foundation remains strong and that we're well positioned to invest in critical areas for growth and navigate the COVID-19 pandemic as we know it today. As Eric mentioned earlier, during the quarter, we further bolstered our balance sheet through an underwritten follow-on offering of equity with approximate gross proceeds of $116 million. Including the net proceeds of the offering, we ended the quarter with cash and cash equivalents of $457.4 million as of June 30, 2020. We will remain disciplined in our use of capital, and notwithstanding any business development activity, we continue to believe that our cash on hand is sufficient to fund our operations beyond the readouts from our phase three studies of Sparcentin into 2023. I will now hand the call back over to Eric for his closing comments. Okay, Eric?

Loans continues to exceed expectations.

We also saw meaningful treatment initiation is was the bile acid portfolio and continue to be pleased with utilization of our genetic panel to help coal study patients potentially signs to.

Diagnosis.

Our organization takes great brands, not just in delivery meta treatments to patients, but also in maintaining access and support that we know is critical.

Slick water disposal careful lifts the stations to ensure interrupted supply of mitigation and providing education and counseling has need us to ease the burden of leading was rare disease. During this time.

In the first quarter, we estimated that the initial reaction to Golden Monkey drove about one in house to 2 million dollar merciful forward shipments increased compliance.

As anticipated the forward shipments of 60 90 days supply normalized during the second quarter and we've assumed our normal shipping centers.

We continue to see a modest increase in patient compliance across our business during the second quarter.

We believe this is the result of the desire, but they seems to have optimal control of their can get conditions. During this time of added stress in the healthcare environment.

As well as a recognition was increased flexibility that you see may provides.

Looking ahead.

Continually to monitored impactful unemployment changes in the basin insurance coverage.

To date has not seen from material chains.

We remain committed to supporting our patients and ensuring that Nolan goes from treatments.

We also believe that basins, including dose we may be candidates for other therapies visiting does physicians less frequently.

While we have seen underlying demand to date is could lead to fewer patients initiating treatment in the second harmful to year.

Eric Dube: Thank you, Laura. Despite the challenges of the COVID-19 pandemic, during the second quarter, our organization remained aligned with our key priorities and made tangible progress on near and long-term objectives. We are progressing the development of Sparcentin such that we now anticipate top-line data from the protein area readouts in both our Pivotal, Duplex, and Protect studies next year. We reach new patients with our approved products and maintain the level of support and service our patients rely on. And we further strengthen our financial foundation, which we believe will allow us to continue fortifying our position as a leader in the rare disease community. While significant uncertainties remain as a result of COVID-19, we have demonstrated a resilience and ability to execute that gives me confidence that we will continue to deliver the highest level of support for our patients and be in a strong position to ultimately deliver sparsentine if approved as the first medicine indicated for FSGS and IgA nephropathy.

Nevertheless, given the strong start to the year, we believe our forecast for mid single digit growth over last year remains achievable.

Overall, we're very pleased with the clear focus and performance on the commercial business to start 2002 income, especially in the face on the goal that 19 pandemic.

So the remainder of the year, we will continue to focus needs, although patients as well as building upon our existing capabilities in order to supports to continued organic growth of our pools brought us into ultimately maximize the potential sparse income so patients living with ssds.

And I.

Hi, Jane from empathy if approved.

I'll now turn the call over to lower to the financial updates.

Huh.

Thank you Peter.

Before I go to our financial results for the quarter.

Please note.

That will be discussing certain non-GAAP financial results.

These non-GAAP results were also included in the earnings press release that we issued shortly before this call along with a presentation of the most directly comparable GAAP financial measure and a reconciliation to GAAP.

The earnings press release is located on the Investor and media pages on our website, Rick hoping dotcom.

During the second quarter.

Chris: Let me now turn the call back over to Chris to open it up for Q&A. Chris? Thanks, Eric. Corey, can you please go ahead and open up the lines for Q&A?

Net product sales from our commercial portfolio grew to 48.4 million, an 8% increase over the same period in 2019.

We reported a GAAP net loss of 26.1 million for the second quarter at 20 training.

unknown: Open up the lines for Q&A. Sure. At this time, if you would like to ask a question, please press star, then number one on your telephone keypad. We'll pause for just a moment to compile the Q&A list. Your first question comes from the line of Joseph Schwartz with S-V-E-R-T-I-N-G-H-R-A-S-T-I-N-G-H-R-A-S-T-I-N-G-H-R-A-S-T-I-N-G-H-R-A-S-T-I-N-G-H-R-A-S-

After adjusting for non cash expenses and income tax we reported a non-GAAP net loss of 9.9 million.

On a GAAP basis, R&D expenses were 30.8 million for the second quarter at 2020.

The decrease compared to the same period in 2019 is largely attributable to the discontinuation of the Firstnet Panto today development program in the fourth quarter of 2019.

On an adjusted basic R&D expenses were 28.2 million for the second quarter.

Joseph Patrick Schwartz: V. B. Lering

unknown: Josephine, your line is open. Hi, can you hear me? Yeah. Hi Joe. Oh, hi, guys. Congratulations on all the progress. Thanks for taking my question. I was just wondering if you could talk a little bit about how the dose titration works in duplex and protect how standardized it has been. How long has that been, and do you think that the investigators are applying it in a uniform manner, and do you have any insight into whether you've been able to achieve target dosing based on the patient's needs during the study?

Relevant noncash expenses for the second quarter included $2.6 million stock based compensation and amortization.

On a GAAP basic selling general and administrative expenses for the second quarter were 35 million.

Minimal decrease over the same period in 2019 is largely attributable to lower professional.

On an adjusted basis as CNH expenses for the second quarter were 25.8 million.

Noah Rosenberg: Sure. Thanks, Joe. I will have Noah talk about the dose titration schedule and then what we are seeing to date. Noah?

Significant non cash adjustments for the quarter consisted of 9.2 million stock based compensation and depreciation and amortization.

Noah Rosenberg: Yeah. Thanks, Eric. Yeah. So that's a great question. In terms of how historically when we ran the Duet study, if you recall, we started patients at 200 or 400 or 800 milligrams. And as a result, at the 800 milligram dose, we saw some dose-limiting blood pressure-related effects in terms of lightheadedness and so forth. And we weren't able to achieve as many patients at that dose to differentiate between the 400 milligram dose. Subsequently, we designed a duplex study, and I think that's where you're going, with a titration step. Patients are started at the 400 milligram dose, and then after two weeks, they are once acclimated to that dose and stable; they come back, and then they get titrated up to an 800 milligram dose.

Looking ahead.

Our near term operating expenses may continue to be difficult to predict any further navigate cobot 19.

Based upon what we know today, we internal R&D will incrementally increase from current levels as we continue to invest in our pivotal trials.

And we anticipate SGN eight Denver likely be similar to modestly lower in upcoming quarters.

We believe our financial foundation remains strong and that we're well positioned to invest in critical areas for growth and navigate the cobot 19 pandemic as we know it today.

As Eric mentioned earlier during the quarter, we further bolstered our balance sheet.

Through underwritten follow on offering of equity with approximate gross proceeds of $116 million.

Including the net proceeds of the offering we ended the quarter with cash and cash equivalents of 457.4 million as of June Thirtyth 20 training.

We will remain disciplined in our use of capital.

Notwithstanding any business development activity, we continue to believe that our cash on hand is sufficient to fund our operations beyond the readouts from our phase three studies that are setting and into 2023.

Noah Rosenberg: In order to help us get that key differentiating data set between 400 and 800, I'll say that I've been pleased with the blinded data that I've seen. Remember, I'm seeing data blinded across doses, but I'm seeing how many patients can achieve that highest dose. And I think that that's been a success for us, and I'm confident that we will be able to get some better sense of that question. Hopefully, that addresses your question, Joe.

Ill now hand, the call back over to Eric for his closing comments Eric.

Thank you Laura.

Despite the challenges of the Tobin 19 pandemic during the second quarter, our organization remains aligned on our key priorities and made tangible progress on near and long term objectives.

We advanced the development of Sparsentan, such that we now anticipate topline data from the proteinuria Readouts in both our pivotal duplex and protect studies next year, we reached new patients with our approved products and maintain the level of support and service our patients rely on.

Eric Dube: Yeah, that's a very helpful insight. Thank you. And then I was wondering, you know, you've been through a lot already with these studies, executing them to date. Have you learned any more insights about the patient community that you're willing to share, such as any new segments, patient subsets taking shape that maybe weren't appreciated before, or, you know, could be, you know, especially good candidates for Sparsington?

And we further strengthen our financial foundation, which we believe will allow us to continue fortifying our position as a leader in the rare disease community.

While significant uncertainties remain as a result of cobot 19, we've demonstrated a resilience and ability to execute that gives me confidence that we will continue to deliver the highest level of support for our patients and being a strong position to ultimately deliver sparsentan if approved as the first medicine indicated for Fs chip.

Eric Dube: Thanks, Joe. Let me start with that one. It certainly is very important that we understand the heterogeneity of FSGS, and that is a lot of what we are aiming to do, not just from a clinical trial perspective, but as we look to reach these patients if approved commercially. We have, I think, one example of what we're doing to really understand that is that we know that FSGS disproportionately affects Black Latinx patients and, for IJ necropathy, We want to make sure that we understand what the patient journey there is like for all patients, including those that are disproportionately affected. I think we do know that there are different barriers to diagnosis and treatment that exist. You know, that's one of the areas that we're looking at. I'll ask Peter to share a little bit more about some of the work that he and his team are doing to understand who these addressable patients are and the journey that these patients are on.

And our junior property, let me now turn the call back over to Chris to open it up for QNX Chris.

Thanks, Eric core acuity. Please go ahead and open up the lunch acuity.

Sure.

At this time, if he would like to ask a question. Please press Star then the number one on your telephone keypad, we'll pause for just a moment to composite can you and I roster.

Okay.

Your first question comes from the line of Joseph Schwartz with SVB Leerink.

Yes, Sir your line is open.

Hi can you hear me.

Yes, Hi, Joe.

Hi, guys.

Congrats on the progress. Thanks for taking my question I was just wondering if you can talk a little bit about how the dose titration works in duplex and protect how standardize has has that been and email I do think that the investigators are ups.

Flying in a uniform manner and do you have any insight into.

Whether you're a been able to achieve target dosing in the patient phase two study.

Sure. Thanks, Joe I will have no talk about the dose titration schedule and then what we are seeing today.

Peter Heerma: Yeah, thanks, Eric. And Joe, thanks for the question.

Peter Heerma: Indeed, I think in the segments that we're talking about, FSDS as well as IgA nephropathy, even though the goal point of the nephrologist is the same, the patient populations are quite diverse, in particular when you also look at ethnicities. We are planning for broad access for those patient communities, so it's important for us to understand the patient journey but also where those patients reside and what their access to care situation is right now. And that's a big part of our launch planning that we are looking into. That makes good sense. Thanks for taking my order. Thanks, Joe.

No.

Yes, Thanks, Eric Joe, Yes, so thats a great question in terms of how historically when we ran the duet study. If you recall, we started patients at 200 or 400 or 800 and as a result at the 800 milligram dose we saw some dose limiting and blood pressure related.

It affects in terms of lightheadedness and so forth.

And we're not able to achieve as many patients at that dose to differentiate between the 400 milligram dose.

Subsequently, we designed the duplex study and I think thats, where you're going with the Tightrail. One step on patients are started at the 400 milligram dose and then after two weeks.

Joseph Patrick Schwartz: Your next question comes from the line of Michelle Gilson.

They are then once acclimated at that dose and stable they come back and then vacate titrated up to 800 milligram dose in order to help us get that key differentiating dataset between 400, 800, I'll say that I've been pleased with the blinded data that I've seen remember I'm seeing data blinded.

Michelle Gilson: Michelle Gilson from Canaccord Genuity

Michelle Gilson: Michelle, your line is open. Hi.

Michelle Gilson: Thank you for taking my question, and congrats on the quarter and the progress. I guess, could you help us maybe understand maybe what's driving the uptick in enrollment versus your expectation in the IGA nephropathy study? One of the things mentioned to us at ASN was just how competitive IGA trials are to enroll, so congratulations on the progress, but is there any feedback you can give us from your investigators or from the study in general that could, I guess, help us understand that?

Across doses, but I'm seeing how many patients can achieve that highest dose and I think that thats been not been success for us and I'm confident that we should be able to get.

Some better sense of that question hopefully that addresses your question Joe.

Yes, it's a very helpful.

Insight. Thank you and then I was wondering.

You've been through a lot.

Already with these studies executing them today.

Noah Rosenberg: Thank you, Michelle. And yes, that's a very important question as we think about not just enrollment but being able to reach these patients if and when approved. Noah, why don't you take this question about what you're seeing in the upcoming... Yeah, great question, Michelle.

Have you have you learned.

Any more insights about the a the patient communities that you're willing to share.

Such as you know any any new segments patient subsets, taking shape that may be wearing appreciated before or.

Could be especially good candidates for Sparsentan.

Thanks, Joe.

Let me start without one if it certainly is very important that we understand the heterogeneity of Fs Jia.

Noah Rosenberg: Really, it goes back to momentum. If you recall, prior to COVID, you know, at the beginning of the year, we saw growing enthusiasm for as far as potential. You know, it was really around the strength of the clinical network that we built to support duplex and protect that it helped us drive that recruitment. And I believe what we're seeing today is really a resurgence of that same interest and understanding of the mechanism. Since it's a non-IST, you know, there are some advantages that Sports Symphony has in terms of how it's responding with sites. And it's a great testament to the dedication from patients and investigators and the work the teams are doing to maintain, importantly, connectivity with the sites and the excitement level there.

And that is a lot of what we are aiming to do not just from a clinical trial perspective, but as we look to to reach our these patients have approved commercially.

We have I think one example of what we're doing to really understand the is that we know that fs Jia disproportionately affects black Latin next.

Patients and for our agenda property patient Asian descent, and we want to make sure that we understand what is the patient journey there for all patients, including those that are disproportionately affected and I think we do know that there are different barriers to diagnosis and treatment that exists.

That's one of the areas that we're looking at a last Peter to share a little bit more about some of the work that key and his team are doing to understand who the addressable patients are and the with the journey that these patients are on.

Hi.

Yes. Thanks.

Joe So the question Indeed, I mean I think in in the second so we're talking about Ssds is lost Igene fluffy, even though goldpoint neutral as you see the patient publish that quite nicely in particular, we also look at the end because these witty.

Noah Rosenberg: Okay. And then just one more, if you don't mind. You've now been cleared three times by the DMC. Can you just help us understand this process better? This continues to come up for us. So could you just help us understand who comprises the committee, what data they're privy to, and what's the objective, if there are any pre-specified events?

We have plenty full broad access for those patient community. So it's important for us to understand Asian journey, but also window stations, we size and what's the nexus to gain situations like now and it's.

All of our longstanding and we are looking into right now.

That makes a good trends thanks for taking my question.

Thanks, Joe.

Your next question comes from the line of.

Shell Gilson from Canaccord Genuity.

Michelle Your line is open.

Hi, Thank you for taking my question congrats on the quarter in the Congress.

Noah Rosenberg: There are signals on the safety side that they're looking for, and that might lead them to request more.

I guess.

Could you.

I guess I understand maybe what's driving uptake in enrollment versus your expectation in the aging of property study.

Noah Rosenberg: Do you want to give us more information or stop the trial, or just give us some background on this process?

One other things mentioned to us any ascend was just how competitive IDH trials are attainable. So congratulations on the progress but is there any feedback you can get to give us from investigators.

Noah Rosenberg: Noah, why don't you take that one? Sure. So our data monitoring committee is made up of a group of

Noah Rosenberg: A group of experts in the field of nephrology, along with a statistician who helps advise on statistical issues. They meet periodically based on recruitment, and when they do, we provide them with standard data sets, demographics, and any safety data that we've collected, and we're able to present it to the group in an open session, but they also have access to unblinded information that we don't see, and they can really ask for anything and everything under the sun that they feel is important to make a decision regarding the risk-benefit of the drug We did that so they would be able to see the totality of data coming from both studies, and I think it's been very encouraging, as you pointed out, that we've had three meetings. The most recent was in April, and we've seen a green light to go forward, and it's very encouraging for us to move forward.

Hello.

The study in general that could I guess help us understand that.

Thank you Michelle and yet that the very important question as we think about not just enrollment, but able to reach these patients if and when approved no or why don't you take this question about what you're seeing in the uptick.

Yeah, Great question Michelle.

Really it goes back to momentum if you recall that we saw in the first quarter this year prior to coated.

Beginning of year, we saw a growing enthusiasm for spores potential was it was really around the strength of the clinical network that we built to support duplex and protect that it helped us drive that our recruitment and I believe what we're seeing today is really versions of that same interest and understood.

Turning of the mechanism its a on a non I have seen other some advantages that that thats for second has in terms of arts resonating with sites.

And it's a great Testament to the dedication from patients and investigators and the work. The teams are doing to maintain importantly connectivity with the sites and the excitement level there.

Okay.

Just a similar.

Mind on is now been cleared three times by the DMC can you just help us understand that this process better. This continues to come up for us. So could you just help US understand you comprises the committee on what data there privy to any in which the objective is there any pre specified event.

Michelle Gilson: Okay, thank you, and congrats again on the quarter. Thank you, Michelle.

Maurice Thomas Raycroft: Your next question comes from the line of Maurice Raycroft from Jefferies. Laurie, your line is open. So the first question is, do you know what proportion of the FSJS patients in phase 3 are actually from the U.S.? And is there anything you can say about the patient characteristics of this study?

Their signals on a safety side that they're looking for.

Maurice Thomas Raycroft: Yeah, thank you for the question. I'll, I'll speak briefly.

And that that might lead them to request for information or stop the trial.

Eric Dube: And I think it's important to remind you that we continue to enroll patients, and so their, their demographics and regional makeup will continue to evolve. So I'll ask Noah to give a little bit of a sense about the clinical trial network that he mentioned and any further insights on the geographic makeup. Yeah.

Could you just give us some color on this process.

No why don't you take that one.

Sure. So our data monitoring committee is made up of a group of experts in the field of nephrology, along with a statistician who helps advice on fiscal issues. They.

Meat periodically based on recruitment.

Noah Rosenberg: So, Eric, to that point, we have a global clinical trial network across over 200 sites in four regions around the world. That's the U.S., Europe, South America, and Asia Pacific. With regard to your question on the U.S., I can just say that evolves, but there is a substantial portion of patients coming from the U.S., and we continue to see some recruitment there even during the pandemic. What we're seeing in terms of the baseline demographics, I think, are similar to what we saw in Duet, and as Eric pointed out, you know, that's an evolving data set, and we will continue to follow and update if there are any significant changes.

And when they do they we provide them with.

Standard datasets demographics and.

Any safety data that we've collected and we're able to present to the group in a in an open session.

But they also have access to unblind the information that we don't see.

I mean, they can really asked for anything and everything under the Sun to date that they feel is important to make up make a decision regarding the risk benefit.

Of the drug and I think it's critical to emphasize that it is a do pro.

Steering committee, we did that so they would be able to see the totality of data coming from both studies.

And I think it's been very encouraging as you pointed out that we've had three meetings.

The most recent was in April and we've seen a green light to go forward and were going for encouraging for us to move forward.

Noah Rosenberg: Okay, thank you. And for the race that you did recently, does it change the scope of your business development plans for any licensing of new assets for large or expansion of special intent for new indications?

Great. Thank you and congrats again on quarter.

As you Michelle.

Your next question comes from the line of Maury Raycroft from Jefferies.

Hi, Your line is open.

Hi, this is sizing on Maui.

The first question regarding you know what proportion us if STS patients in phase three actually from the U.S. and they say anything yet.

Eric Dube: So we continue to look externally at opportunities within rare diseases, and what I would say about our business development and really diversification of our pipeline, certainly we want to make sure that we are looking at opportunities to optimize the development of Sparcentin, but we are also looking at opportunities externally.

About.

Thanks and characteristics of the study.

Yes. Thank you for the question I'll I'll speak briefly and I think it's important to as a reminder, that we continue to enroll patients and so there is there the demographics and regional makeup will continue to evolve so I'll, let us know it to give a little bit offense about the clinical trial network that he mentioned.

Eric Dube: Our focus will be on leveraging the capabilities that we have in late-stage development and commercialization, as well as the therapeutic expertise that we have in rare nephrology, rare hepatology, and related therapeutic areas. So I'd say our strategy and our area focus haven't changed, and we believe that there are some interesting opportunities that exist within that space.

And any further insights on the geographic makeup.

Yes, so our to that point, we have a global clinical trial network across over 200 sites and four regions in the world That's a us Europe.

South America in Asia Pacific with regard to your question on the US I can just say that evolves, but there was a substantial portion of patients coming from the us and we continue to see some recruitment there.

Eric Dube: Thank you. And one last question. Do the timeline bumps accelerate the final study readouts too, like all the EGFR readouts?

Even through the pandemic we will.

What we're seeing in terms of the baseline graphics, I think or similar to what we saw in duet and as our pointed out that's an evolving.

Eric Dube: So it would be based on the final patient enrolled and then followed for two years. So really, the timeline for the final confirmatory EGFR endpoint would be best estimated once we indicate that the last patient has been randomized.

It is set and we will continue to follow an update to 30 significant changes.

Okay. Thank you on slightly raised that gives you a decent you've got it came to the scope apparel business development as rightful aim who assets are locked on expansion of Sparsentan for new indications.

So we continue to look externally at.

Timothy Francis Lugo: Okay, thanks. Thank you. Thank you. Your next question comes from the line of Tom Lugo.

Opportunities within rare disease.

And what I would say about our business development and really diversification of our of our pipeline certainly we want to make sure that we are looking at opportunities to optimize the development of Sparsentan, but we also are looking at and opportunities externally.

Timothy Francis Lugo: Mom Lugo with William Blair Sorry, your line is open.

Noah Rosenberg: and Tim Lugo. Not a problem. Thanks for taking the question. And I guess to Noah, can you maybe drill down a bit on the prepared commentary and the cautious language around the duplex reading timeout? You know, you've already had three DMC reviews, but it still sounds like there's kind of some cautious commentary around the Q121 readout. Is there some sort of variability which the DSMC has been seeing in the EGFR readouts? And I guess how many reviews will there be between now and Q121, which could trigger any sort of expansion?

Our focus will be in leveraging the capabilities that we have in late stage development and commercialization as well as the therapeutic expertise that we have in rare nephrology.

Rare hepatology and related therapeutic areas.

So I'd say our strategy in our area focused.

Hasn't changed and we believe that there are some interesting opportunities that exist within that space.

Thank you and one last question. So does that Diamond bumps X led the final study readout still like all the CFO.

So it would be based on the final patients.

Eric Dube: Yeah, Tim, hey. So I think some of the caution that you may have heard in my voice, and as you know, you followed our story very carefully; we like to be cautiously optimistic, was related to COVID-19 and the pandemic. You know, when you think about where we are right now, as I mentioned, we've seen increased momentum in both studies, approaching, in PROTECT, approaching pre-COVID levels, and duplex heading that way. And I think we've really got some very, very solid, steady progress there that makes us confident in the first quarter readout. So not so much how we're doing now and how we expect to do, it's more, should COVID have a second wave, or should we get worse? You know, we just want to make sure that we're cognizant of that, and we'll follow through throughout the year and update you guys as appropriate.

Enrolled and then followed for two years, so really the timeline of the final confirmatory EG afar endpoint would be best estimated once we indicate that the last patient has been randomized.

Okay. Thank you.

Thank you.

Your next question comes from the line as Tom logo with William Blair.

Sorry your line is open.

Excuse me, Ken let Brad.

No not a problem. Thanks for taking my question.

And.

I guess two to know or can you maybe drill down a bit.

On the prepared commentary on the cost of language around the duplex reading time out you know you've already had three DMC reviews.

But still sounds like there's kind of some cautious commentary around the Q1 21 laid out is there some sort of variability, which the DSMC has been seeing in the Asia, if our re notes or.

I guess, how many reviews will there be between now and Qs 21, which could trigger any sort of expansion.

Yeah.

Hey, so yes, I think some caution that may afford in my voice and and as you know you followed our story very carefully we'd like to be cautiously optimistic.

Eric Dube: Yeah, and Tim, what I can add is part of the aspect in Noah's prepared remarks is around the planned sample size assessment, and we wanted to mention that, one, because it is part of the design in managing the power for the confirmatory EGFR endpoint, but that may have a knock-on effect on the FPRE, which is what we indicated or alluded to, and I think, again, we believe that the quarter one readout of If we find ourselves in a situation where the sample size assessment does increase and there is a continued or worsening restriction of clinical trial sites due to COVID-19, we may need to adjust our timelines for that data readout. Again, that's not what we're seeing today, but it is something as we look forward and we're cautious about what may happen if we do see an impact of the pandemic.

Was related to co between team and the pandemic.

When you think about where we are right now as I mentioned, we've seen increased momentum.

In both studies approaching in in protect approaching pre cobot levels and duplex heading that way.

And I think we've really got some very very solid steady progress there that makes us confident in the first quarter. Our readout. So so not so much how we're doing now and how we expect to do it's more should could happen second wave or should we worsen we just want to make sure.

That we're cognizant of that and we'll follow throughout the year, an update you guys as appropriate.

Yes, and Tim what I can add is.

Part of the aspect and no. His prepared remarks is around the plan sample size assessment and that we wanted to mention one because it is part of the design in managing the power for the confirmatory fr endpoint, but that may have a knock on effect on the.

Timothy Francis Lugo: Okay, and I guess that also would lead to percuss probably being pushed out as well? I'm just trying to kind of understand why Protect seems to be enrolling so well, but yet there still is a lot of caution around duplex. It seems like in FSGS, the rationales are so much more of a giving, but you know, I assume COVID would impact both.

Carry which is which is what we indicated or alluded to and I think again, we believe that the quarter. One read out of that Peary is achievable in quarter one of next year.

If we find ourselves in a situation where the sample size assessment dollars increase.

And there is a continued or worsening restriction clinical trial sites due to covert 19.

Eric Dube: Right, Tim. So, we do see strong momentum or momentum strengthening for both duplex and protect. Recall that last quarter, we did indicate that the sample size should be increased for protect to maintain the power for the EGFR endpoint. So, that change has already occurred.

We may need to adjust our timelines for that data readout again, that's not what we're seeing today, but it is something as we look forward and we're cautious about what may happen, if we do see.

An impact of of the pandemic.

Okay, and I guess would that also lead to protect probably being pushed out as well Im just trying to.

Eric Dube: That gives us the ability to really reflect what that final patient enrollment target is. With all of that information, as we project out, we believe that we're in a good place to be able to report the protein area endpoint next year. With duplex, again, based on what we see today and the final enrollment target without a sample size change, we believe that we're going to have the quarter one SPRE readout. The uncertainty and the difference between duplex and protect is because we've not yet done the sample size reassessment for duplex. So we wanted to provide that transparency that that could happen, not to say that it will, but it could happen by increasing the sample size. That may, in the context of further restrictions on COVID, could have an adjustment in our timing.

No.

Well I understand why take care of seems to be enrolling full well the yet theres still overall caution around duplex.

I'm looking like in a shift the rationale as it so much more of a giving on.

But I assume coded would impact both channels.

Correct.

Right, Tim So we do see.

Strong momentum or or momentum strengthening for both duplex and protect recall that last quarter. We did indicate that the sample size increased four protect.

To maintain the power for the easier far endpoints that change already occurred that gives us the ability to really reflect what is that final patient enrollment.

Target.

And with all of that information as we project out we believe that we're in a good place to be able to report that the proteinuria and point next year.

With duplex again, we believe based on what we see today and the final enrollment target without a sample size.

Timothy Francis Lugo: Okay, understood. Given the state of the base business and the raise during the last quarter, do you still think you're able to run the business at a relatively cash-neutral position? At least until you have to build out an FSGS launch.

Change.

We believe that we're going to have the quarter, one fcr re read out.

The uncertainty and the difference between duplex in protective because we've not yet done the sample size wreath reassessment for duplex. So we wanted to provide that transparency that that could happen.

Laura Kathryn Chico: Thanks, Tim. Laura, why don't you take this question?

Not to say that it will but it could happen in increasing that the the sample size that may in the context of.

Laura Kathryn Chico: Okay. I'm looking at our current run rates for OpEx. I mean, I guess we are relatively, you know, cash neutral, but we expect our R&D expenses to go up modestly from current levels, mostly because we continue to invest in the pivotal studies, and that should continue through the second half of the year. SD&A should trend with current levels closely or potentially slightly down. So our use of cash will increase over prior year levels. But really, our office levels, throughout the rest of the year, there'll be some modest net net increase, but not significantly so. But importantly, we believe the cash with the raise and the cash we had on hand is really able to get us through the readout of both studies, duplex and protect, and into 2023.

Further restrictions of cobot could have an adjustment in our timing.

Okay understood and given the state of the base business.

In the range during last quarters do you still think able to run the business at a relatively cash neutral position.

A lease employee health and build out of local CEO will.

Launch.

Thanks, Tim Lore, why don't you take this question.

Okay.

Okay.

Okay looking at our current run rates for Opex.

I mean, I guess, we are relatively.

Cash neutral, but we expect our.

R&D expenses to go up modestly from current levels.

Mostly because we continue to invest in this pivotal studies and that should continue through the second half of the year.

Yes DNA.

Trend.

With current level closely or potentially slightly down so our use of cash will increase over prior year levels.

[music].

But really our opex level.

Throughout the rest of the year there'll be some modest net net increase but not.

Laura Kathryn Chico: And again, gives us optionality for potential BD if we should see an interesting opportunity there and also to do a solid build out for our launch. And if we end up proceeding into the EU as part of our launch strategy, we don't know yet, but if that is part of our go-to-market strategy, we have the flexibility to be able to invest there as needed.

Significantly so.

But importantly, we believe they cast the rains in the past we had on hand is.

Really able to get us through the retail are both studies duplex and protect and into 2023.

And again gives us optionality for potential BD, if we should see an interesting opportunity there and also to.

Timothy Francis Lugo: Okay, great. Thank you for all the questions.

Hey, let's call it build out for our launch and if we end up preceding into the you as part of our launch strategy. We don't know yet, but if that is part of our go to market strategy, we have and the flexibility to be able to invest there as needed.

Dagan Ha: Your next question comes from...

Dagan Ha: comes from the line of Dagan Ha with BTIG. Sir, your line is open.

Dagan Ha: Great, thanks very much for taking the questions and congrats on all the progress.

Dagan Ha: Thanks for all the color regarding the timeline adjustments.

Dagan Ha: I wanted to drill down a little bit more given the demographics of the United States.

Okay, great. Thank you Paula question.

Thanks, Tim.

Your next question comes from the line of Dagan Haas with BTI key sorry. Your line is open.

Dagan Ha: Michael A. B. B. B. A. M. D. M. P. R. A. N. D. M. P. R. A. M. D. M. P.

Great. Thanks, very much for taking my questions and congrats on the progress from my end as well. So thanks for all the color regarding the timeline adjustments for duplex and protect I wanted to drill down a little bit more given the.

The demographic reference that you made earlier about Fscs and.

Again patients. So if we look at duplex and Protax.

Dagan Ha: I would imagine for you guys to provide us with an updated timeline.

I would imagine for you guys to provide us with an updated timeline you have a fairly good sense of confidence in terms of meeting that renewed a timeline I guess, but given that a lot of these trials that are overlapping between these two trials.

Dagan Ha: You have a fairly good sense of confidence.

Dagan Ha: Transcripts provided by Transcription Outsourcing, LLC.

Dagan Ha: A lot of these trials that are overlapping between these two trials do have locations in various hotspots, if you will. And even in our

To have locations in various hot spots, if you will and even internationally I'm looking at Hong Kong and South Korean sites that exist in both of these trials. They do also report some resurging of cases. So can you help me understand sort of your confidence level. I mean is your prepared remarks basically.

Dagan Ha: International, and Hong Kong and South Korean sites that exist in both of these trials, they also report.

Dagan Ha: report, some resurging of cases. So can you help me understand sort of your...

Dagan Ha: I guess where does the current resurgence pattern come in, in terms of your, your pre-

Giving a too much confidence based on the trends, so far or I guess, where does the current resurgence pattern comment in terms of you are.

Dagan Ha: Production, and then I

Dagan Ha: and then I've got a follow-up question. Thanks.

Your projection and then I've got to follow up thanks.

Sure take on thank you for the question and let me first speaks to the timelines in the last note to speak about the the clinical trial sites.

Dagan Ha: Sure. Dagon. Thank you for the question.

Eric Dube: And let me first speak to the timelines, and then I'll ask Noah to speak about the clinical trial sites. And, yes, we did move on the – or move up the PROTECT proteinuria timeline. The rest of our timelines remain the same, so just wanted to make sure that that was clarified.

Yes, we did move in the or move up the protect from urea timeline. The rest of our timelines remain the same. So just wanted to make sure that that was that was that clarified no why don't you speak a little bit about our clinical trial sites and how the team is managing through any of the changes on.

Noah Rosenberg: Noah, why don't you speak a little bit about our clinical trial sites and how the team is managing through any of the changes in the pandemic and restrictions? Yeah, so I think a couple of key points to make here are communication and connectivity are very high between our team and the sites directly and our CRO. And I think that's really helped us through the pandemic maintain that confidence in the sites and our commitment to this area. And when things opened up in various regions, we were able to see that acceleration.

Depend on the can restrictions.

Yes, so I think a couple of key points to make here our communication. The connectivity are very high between our team and the sites directly and our COO and I think thats really helped us through the pandemic maintain that confidence in the sites and our commitment to this area and when things opened.

Up in various regions, we were able to see that acceleration.

Noah Rosenberg: So I think, you know, that progress really puts us on track, as we talked about, for the pivotal study timelines for next year and gives us confidence there. I think, you know, another important point to make is that we've got a global clinical footprint of over 200 sites in four regions around the world. So I think, as you would expect, in the geographies where there has been less exposure or a reduced spread of the virus, we're seeing activity increase at a higher rate. So, for instance, Asia-Pacific and Europe would be examples of this.

So I think.

Progress Im really puts us on track as we talked about for the pivotal study timelines for next year. It gives us confidence there I.

I think you know another important point to make is we've got a global political footprint over 200 sites and four regions around the world. So I think as you would expect in new geographies, where there has been less exposure or reduced spread of the virus, we're seeing activity increase at a higher rate. So for instance.

Asia Pac in Europe would be examples of this there will also parts of the world, where you're seeing adaptation.

Noah Rosenberg: There are also parts of the world where you're seeing adaptation, where they're using telemedicine or telepresence, the use of a visiting nurse, for instance. So I think there's quite a bit of innovation and adaptability based on the regulatory guidance that was provided by the FDA and EMA. And I think overall, we've seen less of a need for this as the months have progressed, and it looks like, you know, it's starting to..., reduce that need. But I think the caveat, as we said, is that we could go into a situation where we get a second wave, and things could worsen. So there's uncertainties there that we can't control. But I think right now, we feel confident in our reporting timelines and so much so that we have pulled up the Protect timeline as well. Great.

Where they are using telemedicine or tele presence you sort of visiting nurse for instance, so I think there's there's quite a bit of innovation and.

Adaptability based on the regulatory guidance that was provided the FDA gaming audience.

And I think overall, we've seen less of a need for this as the months have progressed.

And we look like you know it's starting to.

To reduce that need but I think the caveat as we said is we could go into a situation, where we can get a second wave and and things could work and so there is uncertainty there that we can't control, but I think right now we feel confident in our reporting timelines and so much so that we pulled off the protect timeline.

As well.

Great. Thanks, very much and then the second question I had a what's with regards to some I again data that's important expected between now and year end.

So I was wondering if you can kind of give us your thoughts on how you think the market dynamics will shape up I mean, given the sort of pull forward in the protect timeline I would imagine. This work is probably picking up pace in terms of understanding the market dynamics that pushes and pulls as you consider sort of nor supplement as well.

Dagan Ha: Thanks very much. And then the second question I had...

Dagan Ha: What's with regard to some IGAN data that's expected between now and...

So as not con potentially being approved based on those.

Yeah. Thanks.

Dagan Ha: [inaudible]

Dagan Ha: Data. Certainly. Thank you, Dagon.

Certainly thank you back on so I'll share my comments and I'll ask no it to share what he is the fear and from investigators and thought leaders.

Eric Dube: So, I'll share my comments, and then I'll ask Noah to share what he is hearing from investigators and thought leaders. Certainly, we are focused on executing our programs to deliver Sparcentin to these patients for FSGS and IgA nephropathy. And, you know, that execution I've been very pleased with as we now see a significant moving up of the timelines for our IgA nephropathy program. Noah, do you want to talk a little bit about how you see the field evolving or perhaps what you're hearing from top nephrologists? Yeah, I mean, especially in the COVID pandemic, you know, what we've been fighting in terms of prioritization, both of clinical trial recruitment, and also some emergent data sets regarding steroid or IST use have really put front and center the need for non-IST type approaches. I think Spursyntin falls nicely into that category.

Certainly we are focused on executing our programs to deliver sparsentan two to two these patients for Apis, Jeff and I junior property and that execution I've been very pleased with as as we now see.

A significant moving up of of the timelines for RG.

The property program no or do you want to talk a little bit about how you see the field evolving or perhaps what you're hearing from continent prologis.

Yeah, I mean, I think especially in the in the koby pandemic what weve.

Sites in terms of prioritization.

Both of clinical trial recruitment.

And also some emerging datasets regarding.

All right or is to use has has really put front and center the need for non I S. T type approaches.

Thanks for sneaking falls nicely into that category you mentioned a couple of compounds that are actually in the immune suppressive tap and I think that while.

Noah Rosenberg: You mentioned a couple compounds that are actually in the immune suppressive camp. And I think that while, you know, there's certainly patients, some patients require need steroids, it's something that clearly has some side effects and concerns for long-term use. So I think we're in a good position there. I think we've heard that directly from the sites. And I think that's probably why we're seeing the uptick in recruitment now and the focus, especially during the pandemic, which the ISTs have also been invoked as potentially raising risk for patients for COVID-19. So that's a concern of patients and sites as well. So hopefully, that addresses your question.

There are certainly patients some patients require need steroids. It's it's something that clearly there is some side effects and concerns long term use.

So I think we're at a good position there I think we've heard that directly from sites and I think that's probably why we're seeing the uptick in recruitment now and the focus.

Especially during the pandemic, which the isds have also been in both potentially is raising risk for patients Workover 19, So thats a concern of patients and sites as well so hopefully that addresses your question.

Sort us thank you very much guys.

Dagan Ha: Sure does. Thank you very much, guys. Again, if you'd like to ask a question, please press star 1 on your telephone keypad. Your next question comes from the line of Gina Wang.

Thank you take on.

Again, if you'd like to ask a question. Please press star one on your telephone keypad.

Next question comes from the line of genome Wang from Barclays.

Gina Wang: from Barclays.

Gina Wang: from Barclay. Ma'am, your line is open.

Ma'am your line is open.

David Dyer: Hi, this is David Dyer from Virginia. Thank you for taking my questions. And again, congrats on the strong quarter. I will have a question about commercial sales. So the question is regarding the COVID-19 impact on sales. So all the companies have seen a large impact in April and sort of gradual improvement in May and June. Is that the trend that you're seeing as well? And how should we think about the trend going forward? Is it going to be more toward the pre-COVID-19 impact?

And this is David dye on casino take of taking my questions and again question Congrats on a strong quarter.

I will have a question on the.

Commercial sales.

So the questions regarding the CBS over 19 impact on sales to other companies have seen large impact in April industrial gradual improvement in May and June is that the China, you're seeing a swell and how should we think about trend going forward is going to being were too much where the pre coven 19.

Thank you David for the question.

David Dyer: Thank you, David, for the question. You know, as we've indicated, we saw strong performance from our commercial organization in quarter one and in quarter two. I'll ask Peter to share a little bit more detail about the trend. But, you know, again, we don't provide further detail on a monthly basis but have seen a strong uptake in terms of new patient acquisition during the pandemic as well as before. Peter, anything further that you'd like to add?

As we've indicated we've seen strong performance from our commercial organization in quarter one.

And in quarter, two I'll ask Peter to share a little bit more detail about the trend, but again, we don't provide further detail on a monthly basis, but have you know seeing strong uptake in terms of of new patient acquisition during the the dependent mic as well as before tier anything further that you'd like to.

Okay.

Yes, thanks, Jason Thanks for the question Dave.

Peter Heerma: Yeah, thanks Eric, and thanks for the question Dave. To Eric's point, I think we have seen strengths for all three products that are mainly driven by new patient starts. And I think, given the nature of our business in rare diseases, we have a very experienced field force that is very closely connected to physicians. And I think that dynamic continues to happen in the virtual world right now. But often physicians also see our camp, our field teams, as an additional support system to help serve patients better. I think that may be slightly different than large organizations where it's more focused on the sales goal and relative support. So I think in that respect, we have seen solid performance in the first half of the year.

James splits I think we have seen strengths.

So all three products that is mainly driven by new patient starts and I think given the nature of our business.

In rare disease, we have a very experienced field force that is very closely connected to the physicians and I think that dynamic continues to happen in the future World right now.

But often lake physicians also see our games hour.

Okay.

As an additional support system to help so if patients better I think if that maybe slightly different than large organizations that where.

It's more focused sales goal and wrong to support so I think investors. Thanks, we have seen solids.

Formats in the first hobbled year, it's difficult to say for the second half deal with regards to.

Peter Heerma: It's difficult to say for the second half of the year with regard to the uncertainty. I think in the pre-announced script, we talked about how there could always be differences with regard to patient access and insurance rates, maybe due to unemployment rates. But, um... So far, I think we have had solid performance, and as we said earlier, I think we are confident that we can stay within the guidance of mid-single digit growth.

Certainty in the in the pre.

On those scripts, we talks about like the could always be differences with regards to Beijing excess and insurance rates, maybe give to you.

Unemployment rates.

Yes.

So far I think we have had sold performance and.

As we said earlier, we are confident that weekend.

State was in the guidance of mid mid single digits girls.

Corey: Corey, maybe we can go to the next question. Sure, I was just about to ask if you wanted me to do that. Your next question comes from the line of Go Kemp. Joe, your line is open.

Currently we have into next question.

Sure I was just about to ask if you wanted me to do that.

Your next question comes from the line of go Kim.

So your line is open.

Go Kemp: Good afternoon, everyone. This is E.K. Onford Doe.

Hi, Good afternoon, everyone. This is each day off for Doe. Thanks for taking my question and congrats on the progress for the quarter.

E.K. Onford Doe: Thanks for taking my question and congrats on the progress for the quarter. Mine entails a little bit far out, but in terms of the overlap between your current relationships with nephrologists through your base business and potential treatment providers for FSGS and IGAN, if you can speak to that a little bit. Given that, and Laura just said that SG&A is expected to kind of stay consistent, potentially be a little bit reduced there, given that you're going to have to start ramping up for the commercial launch of As Far As Scentin', I just kind of want to reconcile those two. I don't know if there's some potential internal restructuring that's on the horizon based off of something that's going on with the pandemic that's kind of allowed you to potentially reduce costs in that front. But if you can give some color on both of those, that'd be helpful for us.

Mine entails the limit far out but in terms of the overlap between your current relationships with Nephrologist through your base business and what the potential treaters for Fscs in Nigeria, and if you can speak to that a little bit.

Given that a larger said that issue in a is expected to kind of stay.

Consistent potentially be a little bit reduced their.

Given that you're going to have to start ramping up for the commercial launch.

As far as sense, and that's kind of want to reconcile those two I don't know there's potential internal restructuring that's a on the horizon based off of something that's going on with the pandemic Thats kind of allows you to potentially reduce cost and that front, but if you're going to give some color.

On both of those that'd be helpful for us. Thanks.

Eric Dube: Sure, thank you for the question, and I would say that we do not have any plans to cut costs or make any changes with regard to the pandemic. Our focus will continue to be growing our commercial business and in progressing our plans with Sparcentin for a successful filing and, ultimately, the launch. Peter can talk a little bit about what he sees as the potential overlap in prescribers that we currently work with and those that may be prescribers for Sparcentin. Peter.

Sure. Thank you for the question and I would say that we do not have any plans to cost cut or make any changes with regard to but pandemic our focus.

We'll continue to be in growing our commercial business and and progressing our plans with sparsentan for successful file and ultimately the launch Peter can talk a little bit about what he sees for the potential overlap in prescribers that we currently work with and those that may be prescribers for Sportscenter Pete.

Sure.

Yes.

Peter Heerma: Yeah. Thank you for that, and I think it's a very good question, and I think given the current footprint that we have, the established footprint, nephrology is an important call point for us already. So I think we operate from a position of strength, and we can sort of build our organization to really optimize the launch for our center in FFDS and IGA on the front. I mean, there's a high unit need in those patient populations, and... Thank you.

Thank you for a few that's in the going on I think it's a it's a very good question.

And I think given the current stupendous, we have established footprints.

Nephrology isn't important full points first already.

So I think we operate formula decisional strengths and we can sort of build our organization to really optimized longs for sparsentan in FX, yes, and ideas in front of the.

There's a high degree of needs in those patient populations and.

I was speaking early life understanding the patient population, it's an important elements.

We really are set up for success when we when we launch the product and we did you do most preparation for that but like I said, it's not like you start from scratch I think we have a well established commercial some trends.

Peter Heerma: There are no further questions at this time.

Corey: No further questions at this time. Great.

unknown: Thank you, Corey. And thank you, everybody, for joining us today. This concludes our call. I appreciate you sticking through it with the technical issues that we ran into. And we look forward to updating you on our progress as we move through the balance of the year. Ladies and gentlemen, this does conclude today's conference call. Thank you for your participation. You may now disconnect.

Gave a little detail you can sort of built upon this already foremost phones folks on the branches.

Okay.

Thank you.

There are no further questions at this time.

Great. Thank you Corey and thank you everybody for joining US today. This concludes our call I appreciate you taking through it.

With the technical issues that we ran into and we look forward to updating you on our progress as we move through the balance of.

Good afternoon.

Ladies and gentlemen, this does conclude todays conference call. Thank you for your participation you may now disconnect.

Okay.

Peter you need to mute your.

Peter: Peter, you need to mute your laptop. I want to know how much Bill wrote to the analysts so I don't ask him any questions.

Thanks.

Bill.

Yes.

[music].

unknown: [inaudible]